Tim Price

For Market Volatility, Blame (or Credit) the Media and the Internet

I respectfully disagree. There is a fascinating interview on Bloomberg between Tom Keene (if memory serves) and David Goldman of Asteri Capital. Mr Goldman suggests that hedge funds that report on a monthly basis (and that offer their investors regular liquidity) are facing a potential catastrophe of serial liquidation. There are too many crowded trades out there and many hedge funds are sufficiently flimsy in orientation and structure that they can get taken out on a malign tide of redemptions. The "little guy" doesn't have to report to external investors and can more easily weather extreme volatility in price variation. Right now, I think the "little guy" is very well positioned in these markets - provided he or she has the emotional discipline not to panic at noisy price action that moves against them.